Key equity indices the Sensex and the Nifty ended in the green on August 27, as investors waited for signals on stimulus tapering and asset purchases from the annual Jackson Hole conference.
Jackson Hole Economic Symposium is an annual huddle of central bank chiefs, finance ministers, leading financial market players, and academic luminaries in Wyoming, United States.
The Indian market wobbled at the start of the session but steadied later and the Nifty even made a fresh all-time high of 16,722.05 in the intraday trade.
The Sensex closed 176 points, or 0.31 percent, up at 56,124.72, while the Nifty settled at 16,705.20, up 68 points, or 0.41 percent.
“Indian benchmark indices remained in the positive territory even as global markets traded mixed as investors awaited announcements from the Jackson Hole Economic Symposium,” Vinod Nair, Head of Research at Geojit Financial Services pointed out.
Markets were awaiting comments from the Fed chair on the US economy and clarity on its future policy changes, he said.
UltraTech Cement, Larsen & Toubro, Dr Reddy’s Labs, Bajaj Finserv and Sun Pharma were the top Sensex gainers.
Broader markets outperformed, as the BSE midcap index closed with a gain of 1.04 percent and the smallcap index rose 0.93 percent.
The overall market capitalisation of BSE-listed firms jumped to Rs 243.7 lakh crore from Rs 241.9 lakh crore in the previous session, making investors richer by Rs 1.8 lakh crore in a single day.
Sectors and stocks
All sectoral indices ended in the green on BSE.
With a gain of 2.14 percent, the BSE captial goods index emerged as the top gainer followed by basic materials (up 1.69 percent), industrials (1.58 percent), power (1.46 percent), metals (1.44 percent), utilities (1.37 percent) and telecom that gained a percent.
Nearly 170 stocks, including TCS, Alkem Laboratories, Britannia Industries, Avenue Supermarts, Fortis Healthcare, L&T Technology Services, Larsen & Toubro Schaeffler India and Timken India, were at a 52-week high.
More than 350 stocks, including Ganesh Housing Corporation, Laxmi Organic Industries, Add-Shop ERetail, Vishnu Chemicals, Autoline Industries, Nureca and Goodluck India, hit their upper circuit on BSE.
Technical view
The Nifty formed a bullish candle on the daily scale, with a long lower shadow.
As per Chandan Taparia, Vice President and Derivatives Analyst, Motilal Oswal Financial Services, the index has been making higher highs, higher lows for the last four weeks.
“Now, it has to continue to hold above 16,700 to extend the move towards new lifetime high territory of 16,800 and 17,000. On the downside, support is seen at 16,500 and 16,380 levels,” Taparia said.
“India VIX fell by 1 percent from 13.54 to 13.41 level. Cooling down of volatility from recent swing highs has given a buy on decline stance to the market and now VIX needs to hold below 12 to get more buying interest in the broader market,” he said.
Outlook for August 30
Shrikant Chouhan, Executive Vice President, Equity Technical Research, Kotak Securities
Technically, after the short-term correction, the Nifty has maintained higher high and higher low series formation and after a strong pullback rally, the index is trading near the breakout level.
The texture of the chart suggests that the 10-day simple moving average (SMA) or 16,550 would be the sacrosanct level for the breakout.
If the index crosses the level, the uptrend can continue to 16,825-16,950. On the flip side, dismissal of 16,550 may trigger temporary weakness till 16,375-16,300 levels.
The Bank Nifty has been consistently taking support near the 50-day SMA, and 35,200 would be its key support level and above it, the index will likely outperform in the near future.
Rahul Sharma, Co-Founder, Equity99
We expect the rally to sustain and the market to make new highs in the coming days.
On the technical front, 16,650 will act as immediate support and if this level is broken, the Nifty may slide to 16,575-16,500 levels. On the upper side, 16,780 will act as a hurdle. Once the level is breached, the Nifty can move to 16,840-16,900 levels.
Ajit Mishra, VP – Research, Religare Broking
Markets are largely mirroring the global counterparts and now all eyes are on the US Fed Chair statements for any signal on tapering and way forward. Though the trend is positive, we are not seeing decisiveness as participation is slightly restricted. We thus suggest avoiding aggressive bets and preferring index majors over others.
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